Supreme Court of Texas Blog: Legal Issues Before the Texas Supreme Court

No. 13-0673
TAMES

ROY SEGER, ET AL. v. YORKSHIRE INSURANCE CO., LTD., AND OCEAN MARINE INSURANCE CO., LTD.

Oral argument was held on September 3, 2015. The Court issued an opinion resolving the case on June 17, 2016. It then denied rehearing on December 2, 2016 File Closed

In the news...

Tracking 1 article about this case.

August 31, 2015

Preview of the first September argument sitting

from SCOTXblog

This article also mentions 6 other cases.

The Court has issued opinions:

Opinion

June 17, 2016

Green
Hecht
Johnson
Willett
Guzman
Lehrmann
Boyd
Devine
Brown

Justice Green delivered the opinion of the Court.View Electronic Briefs | Oral Argument | Video PDF

 

Court of Appeals

Appellate District:7th Court of Appeals
Outcome Below:Reverse & Render
COA Docket No.:07-12-00090-CV
Opinion Author:Honorable Mackey K. Hancock

Trial Court

Trial Court:84th District Court
County:Hutchinson
Trial Judge:Honorable William D. Smith
Trial Docket:33,355

Docket Entries

Date Event Outcome  
2017-01-11 Mandate issued  
2016-12-02 Motion for Rehearing - Disposed   Denied
  This case was waiting for a decision about a pending motion for rehearing between October 11, 2016 and December 2, 2016.  
2016-10-11 Response to Amicus Curiae Brief filed (Petitioner)  
2016-10-10 Call received
2016-10-10 Amicus Curiae Brief received  
2016-09-30 Reply to Response to Motion for Rehearing filed (Petitioner)  
2016-09-23 Letter Filed  
2016-09-21 Response to Motion for Rehearing (Respondent)  
2016-08-09 Motion for Extension of Time disposed.   Filing granted
2016-08-09 Motion for Extension of Time to File Response  
2016-08-05 Supreme Court of Texas Requested Response  
2016-07-25 Motion for Rehearing  
2016-07-25 Case forwarded to Court
2016-06-21 Motion for Extension of Time to File Motion for Rehearing disposed   Filing granted
2016-06-21 Motion for Extension of Time to File Motion for Rehearing  
2016-06-17 Opinion issued   Court of appeals' judgment affirmed
2016-06-17 Court approved judgment sent to attorneys of record   Issued
  This case was awaiting the Court's decision after oral argument between September 28, 2015 and June 17, 2016.  
2015-09-28 Post submission brief filed (Respondent)  
2015-09-22 Post submission brief filed (Petitioner)  
2015-09-03 Oral argument  
2015-09-02 Exhibits in case/cause filed (Respondent)  
2015-08-12 Amicus Curiae Brief received  
2015-07-30 Amicus Curiae Brief received  
2015-07-08 Amicus Curiae Brief received  
2015-07-08 Oral Argument Submission Form from Attorney received  
2015-07-06 Oral Argument Submission Form from Attorney received  
2015-07-03 Case set for oral argument   Case set for oral argument
  This case was waiting for oral argument between May 8, 2015 and July 3, 2015.  
2015-05-08 Amicus Curiae Brief received  
  This case was waiting for oral argument between March 13, 2015 and May 8, 2015.  
2015-03-13 Petition for Review disposed   Filing granted
2015-03-13 Petition for Review granted
2015-03-06 Response to Amicus Curiae Brief filed (Respondent)  
2015-02-20 Reply Brief  
2015-02-11 Amicus Curiae Brief received  
2015-01-29 Motion for Extension of Time disposed.   Filing granted
2015-01-27 Motion for Extension of Time to File Brief filed  
2015-01-21 Fully hyperlinked brief filed (Respondent)  
2015-01-20 Brief on the Merits (Respondent)  
2014-12-11 Letter Filed  
2014-12-10 Motion for Extension of Time disposed.   Filing granted
2014-12-09 Motion for Extension of Time to File Brief filed  
2014-11-26 Case Record Filed
2014-10-31 Motion for Extension of Time disposed.   Filing granted
2014-10-30 Motion for Extension of Time to File Brief filed  
2014-10-24 Brief on the Merits (Petitioner)  
2014-09-22 Motion for Extension of Time disposed.   Filing granted
2014-09-22 Motion for Extension of Time to File Brief filed  
2014-09-02 Record Requested in Petition for Review
2014-08-29 Brief on the Merits Requested  
2014-08-29 Motion for Rehearing - Disposed Filing granted
2014-08-29 Brief on the Merits Requested
2014-08-29 Petition Reinstated
2014-08-29 Previous Order of the Court withdrawn
2014-08-20 Amicus Curiae Letter Received  
2014-08-15 Reply to Response to Motion for Rehearing filed (Petitioner)
2014-08-08 Letter Filed  
2014-08-06 Response to Motion for Rehearing (Respondent)  
2014-06-27 Motion for Extension of Time to File Response  
2014-06-27 Motion for Extension of Time to File Response disposed   Filing granted
2014-06-20 Supreme Court of Texas Requested Response  
  This case was waiting for a decision about a pending motion for rehearing between April 8, 2014 and June 20, 2014.  
2014-04-08 Case forwarded to Court
2014-04-02 Motion for Rehearing  
2014-02-25 Motion for Extension of Time to File Motion for Rehearing disposed   Filing granted
2014-02-25 Motion for Extension of Time to File Motion for Rehearing  
2014-02-14 Petition for Review disposed   Denied
2014-01-09 Reply to Response (Petitioner)  
2013-12-23 MET to file reply disposed of   Filing granted
2013-12-20 Motion to Extend Time to File Reply filed  
2013-12-18 Response to Petition (Respondent)  
2013-11-14 Motion for Extension of Time disposed.   Filing granted
2013-11-14 Motion for Extension of Time to File Response  
2013-10-18 Supreme Court of Texas Requested Response  
2013-09-17 Case forwarded to Court
2013-09-13 Response Waiver filed  
2013-08-30 Letter Received  
2013-08-29 Petition for Review (Petitioner)  

Parties

Party Counsel Role
Seger, Roy
Mr. David M. Russell
Mr. John T. Smithee
Petitioner
Yorkshire Ins. Co., Ltd.
Mr. Lawrence Matthew Doss
Mr. David J. Plavnicky
Mr. Mike A. Hatchell
Mr. Donald M. Hunt
Mr. Charles R. 'Skip' Watson Jr.
Respondent

Amici Curiae

Amicus Curiae Counsel
Texas Coverage Lawyers
Mr. Marc E. Gravely
Mr. Joe K. Longley
Mr. Brendan K. McBride
Mr. Mark A. Ticer
Scott G. Ball
Mr. Ernest Martin Jr.
William John Chriss
Mr. Brian L. Blakeley
Ms. Linda Marie Dedman
Texas Civil Justice League
Mr. George S. Christian
Lloyd’s America, Inc.
Ms. Leslie Ritchie Robnett
Texas Insurance Coverage Lawyers
Mark A. Ticer
American Insurance Association
Mr. Levon G. Hovnatanian
Property Casualty Insurers Association of America
Mr. Levon G. Hovnatanian
Lexington Insurance Company
Mr. Scott A. Brister
National Union Fire Insurance Company of Pittsburgh, PA.
Mr. Thomas C. Wright
Mr. Henry S. Platts Jr.
Ms. Elizabeth Holman Rivers
Mr. Michael A. Choyke

insurance

Diatom purchased a commercial general liability (CGL) policy. The Segers sued Diatom for wrongful death. The insurers denied Diatom's request for a defense under the policies, so Diatom proceeded with the defense it could afford. During this time, settlement offers within the policy limits were made and rejected; the insurer was notified of proceedings but declined to appear. After a one-day trial at which evidence was heard, but at which Diatom was represented only by a lay corporate official not an attorney, the Segers prevailed and won a judgment in excess of the policy limits.

Diatom then agreed to assign to the Segers its possible Stowers claim against its own CGL insurers for having failed to provide a defense. The Segers moved forward against the insurers on that theory.

The key question in the court of appeals was whether the insurers were now barred from contesting, in this case, the reasonableness of the judgment they had refused to defend. In State Farm Fire & Casualty Co. v. Gandy, the Supreme Court held that insurers could challenge the basis for a Stowers claim, when there was an assignment of the claim to the plaintiff and certain equitable factors were implicated. Precisely how to draw that line was not clear. In Evanston Insurance Co. v. ATOFINA Petroleum, Inc., the Supreme Court held that a different set of circumstances fell outside Gandy:

Gandy's holding was explicit and narrow, applying only to a specific set of assignments with special attributes. By its own terms, Gandy's invalidation applies only to cases that present its five unique elements. Here, Gandy's key factual predicate is missing: ATOFINA made no assignment of its claim against Evanston; ATOFINA sued Evanston directly. That removes this case from the formal bounds of Gandy.

The facts here present a mixed bag. The case lacks the "five unique elements" that ATOFINA mentioned were present in Gandy. But on the other hand, it does involve an assignment of a claim, the factor that ATOFINA called the "key factual predicate."

The Supreme Court has granted review and may bring more clarity to this question of when insurers might be exposed to Stowers claims for refusing to defend.

The case also raises some additional questions about the recourse if an insurer violates certain statutory requirements. According to the insurers (several of whom have filed amicus briefs), if an insurance policy becomes void for failure to comply with these requirements, then the only remedy under the statute is for a policyholder to cancel the contract. A group of lawyers who represent commercial insureds has filed an amicus brief arguing the opposite, that the effect of this kind of violation is to take away the insurer's defenses, making the policyholders whole and removing any incentive for insurers to skirt the rules.

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